ISLAMABAD: Another fast-track three billion dollars mega project, an LNG terminal at Gwadar and a pipeline to Nawabshah, is being launched by the Nawaz Sharif government with Chinese collaboration.

In a major strategic move, the Ministry of Petroleum and Natural Resources (MoPNR) has decided to build the LNG terminal and pipeline through a Government-to-Government (G2G ) arrangement with China. Experts say this would mean that the project will not be advertised for open international bidding.

“We are running from pillar to post to get this mega LNG terminal-cum-pipeline included in the list of early harvest projects agreed with China and once it is included, it will take three to four years to get commissioned,” Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi told The News.

“We have already sensitised the prime minister about the proposed LNG project at Gwadar and hope to get this project in early harvest projects list.”China has promised to provide $35 billion in projects relating to the economic corridor and energy related projects and this new project will also be funded through the same scheme.

Two Chinese companies have already shown interest in building the LNG terminal at Gwadar and lay down the pipeline. The pipeline will require $1 billion and over $2 billion will be needed to construct the terminal with LNG handling and re-gasification facilities and to erect large LNG storages facilities.

“This will be the second LNG terminal as the first fast track terminal is being constructed by Engro’s ETPL (Elengy Terminal Pakistan Limited) at Port Qasim, which is scheduled to be completed by March 31, 2015 but we are hoping that the terminal will be completed by December this year,” the minister said.

Mentioning the LNG project at Gwadar, the minister said, whenever the US sanctions now imposed on Iran are lifted, this Nawabshah-Gwadar pipeline will be extended backwards from Gwadar to MP 250, a point at Pak-Iran border for the import of Iranian gas. Its capacity will be increased to one billion cubic feet of gas per day.

The Gwadar-Nawabshah pipeline will have the same specifications with diameter of 42 inches that is proposed for the Iran-Pakistan (IP) gas pipeline.According to officials, since Pakistan is unable to lay down the 781-kilometre-long pipeline from the Iran border to Nawabshah because of Pakistan’s inability to arrange foreign funding, it has been decided to lay down the pipeline from Gwadar to Nawabshah under the G2G arrangement with China that will transport at least 500 mmcfd after re-gasification of imported LNG.

To a question, the official said that LNG terminal to be constructed at the Gwadar Port will have handling capacity of 690 mmcfd and in addition, large LNG storage depots at Gwadar will also be constructed from where after re-gasification, gas will be transported to Nawabshah to be injected into the national gas network.